An investigation is being launched into how a Lower Waitaki aquifer became contaminated with E. coli.
The Otago Regional Council has put the warning out to locals to assume their private bore water is contaminated.
CEO Sarah Gardner says the council is trying to get the word out to those affected.
"We know that we've got about 119 bore owners, but it's possible that bore water is being shared with other people or other properties."
A letter has been sent. Ms Gardner says some community water supplies are also affected, but not the town supply. Locals are being told to assume their private bore water is contaminated until further notice.
"If you have an alternative source of water - for example, rain water - you should switch to that," said Ms Gardner. "Otherwise you need to perhaps use bottled water… it's important that you assume the water is contaminated."
An investigation will be launched immediately.
"The first thing we need to do is understand where the contamination is coming from," said Ms Gardner.
"We need to wait until we've done that until we can make an assessment of whether or not it's possible to return the aquifer's water quality to within drinking water standards."
Water problems further north too
Residents in Dannevirke will have to boil their water this weekend.
Equipment failure has meant water is being drawn directly from the river, and people will have to boil it while it is still in the process of being chlorinated.
Tararua District Council is warning people with poor immune systems or who are pregnant that they may be at increased risk.